Southland district councillor and community board appointee Jon Spraggon is keen to see a new solar farm running on the island. PHOTO: RNZ

A Stewart Island/Rakiura representative warns the remote island could ‘‘lose people’’ as residents brace for another potential power price hike.

Just two months after electricity prices on the island jumped almost 5%, its community board will meet tomorrow to discuss whether it should endorse a further increase from the current rate of $0.89/kWh — a figure which is already double that paid on the mainland.

Work is under way on Stewart Island to create a solar farm, but the island is still fully reliant on diesel generators for electricity which has proven problematic under the present fuel crisis.

Southland district councillor and community board appointee Jon Spraggon said even a $0.04 increase could affect people on a budget, acknowledging it was a ‘‘bad time of year’’ heading into winter.

‘‘The sooner we can get this solar farm up and running and stop some of the reliance on diesel the better,’’ he said.

Community board members will be presented with three options at tomorrow’s meeting: do nothing, endorse a price increase to $0.93/kWh, or back the council to change the price as required based on the average price of diesel over the previous six-month period.

A graph prepared for the final option showed the kWh rate would jump to $1.20 by Christmas if the average cost of diesel was $3.00 across the six months to December.

Asked what it would mean for residents if power reached that price, Mr Spraggon painted a grim picture.

‘‘I would say you’d lose population.’’

A report prepared for the board said the price of diesel had fluctuated between $1.53 and $3.54 per litre since the start of March with a year-to-date average of $1.85.

The most recent price increase was approved by Southland District Council in April and resulted in the kWh price rising by $0.04 per unit to $0.89kWh.

The council also freed up $250,000 from reserves at that time to help subsidise rising costs.

In May, soil was turned at the site of the island’s new solar farm where an estimated 3000 solar panels are set to be installed.

The government said the project was expected to be finished in early 2027 and should reduce diesel consumption by as much as 75%.

Power prices were expected to be cut by up to $0.35 per kWh, it said.

Any changes endorsed at tomorrow’s community board meeting will require final approval from the council.

• LDR is local body journalism co-funded by RNZ and NZ On Air.